Final Results - Replacement
Northamber PLC
22 September 2000
The issuer has made the following amendment to the 'Final Results' announcement
released today at 7:30 under RNS No 3593R.
Further to the announcement made earlier today, the following text should have
been included in the Chairman's Statement:
'Trading
The first half results were disappointing, restricted by the prolonged
downturn and low levels of pre-millennium demand. As already widely reported,
the post millennium marketplace then failed to produce the full extent of the
awaited and anticipated upturn. Whilst sales levels were firm, if unexciting,
the launch of Microsoft's Windows 2000 and faster offerings from Intel, also
then failed to fuel any new replenishment cycle.
These improved results are the product of the differentiation your Company
brings to its marketplace. They demonstrate our very high level of technical
expertise and added value. It is these core skills, over and above the
perception of our 'A' brand product distribution activities, which enable a
worthwhile return on the capital employed.
There was an increased contribution from our high levels of expertise in
complex I.T. network server system and corporate PC's assembly. These coupled
with improved efficiencies in stock turns and our fast order processing and
delivery, helped to better serve our established customer base, enabling them
to better focus on their own local business opportunities and core competence.
Financials
Whilst necessarily focusing on cost efficiencies and the controls on high
volume and marginal product sales, the value of our stocks at year end is
below that of last year. We continue to maintain our policy for the managed
avoidance of profitless revenue.
Results were further enhanced by the use of our available cash resource to
increase the controlled levels of credit extended to our customers.
During the period, when the Company's share price was unrepresentative of its
underlying value, there were several purchases of the Company's issued shares
for cancellation. With the financial resource readily available, such share
buy-backs will continue with the intention of further enhancing earnings per
share.'
The full text of the announcement as it should have read including such text
is set out below.
'Northamber plc
Preliminary Results
Year Ended 30 June 2000
Highlights
Year Ended 30th June 2000 30th June 1999
Profit before Plus 19.14percent
tax
7.52 million pounds 6.32 million pounds
Sales revenue Plus 2.36percent
284.27 million pounds 277.73 million pounds
Earnings per Plus 28.0percent
share
15.1p 11.8p
Net asset value Plus 10.1percent
per share
101.1p 91.8p
Pre-tax margin Plus 19.14percent
2.64percent 2.27percent
Return on Plus 3percent
capital
employed
22.1percent 19.1percent
Stock turns Plus 15percent
23 20
Creditor days
19 23
Debtor days
44 38
Net cash 0.1 million pounds 4.983 million pounds
Proposed final dividend 4.0p per share. A total of 6.0p for the year, a
20percent increase on the 5p last year.
All 1999 comparatives figures are pre-exceptional FRS 11 item.
David Phillips, Chairman commented:
'These strong, rewarding results cover a protracted period of adverse and then
lacklustre market conditions, pre and post the millennium.
Northamber has positively differentiated itself within its peer group
throughout this period and has again established its ability to profitably
manage difficult trading conditions. This ability is enhanced by the high
value added expertise and service content of our offering to our customers.
The marketplace is now on a more stable basis and the Board is confident of a
successful outcome for the year'
Total number of shares in 33,989,000
issue
Weighted average number of 34,131,038
shares
Date of the AGM 10 November 2000
Ex dividend date 6 November 2000
Dividend date 5 December 2000
These preliminary results were approved by the Board of Directors on September
22 2000.
A copy of these Preliminary Results is being sent to all shareholders and is
available to the public from the Company's trading office at 1 Lion Park
Avenue,Chessington, Surrey KT9 1ST.
Please call the Shareholder Support Line on 0208 296 7171 with any enquiries.
CHAIRMAN'S STATEMENT
Results
These strong results together with twenty years experience of IT distribution,
have again clearly and positively differentiated Northamber's trading
performance and value added model from that of our peer group. The technical
expertise within our services activities contributing satisfactorily to this
outcome.
The 19.14% increase in pre tax profits to 7.52 million pounds compares
very favourably with the 6.04 million pounds reported a year ago . This
increase was achieved despite the well reported, adverse and then slow I.T.
market-place conditions pre and post the millennium.
At 284.27 million pounds, revenue growth was moderated to 2.36 percent by the
pursuit of improved margins and compares with 277.73 million pounds for the
prior year.Contrary to the expectation of the sector, this illustrates our
own focus and emphasis on profitable revenue growth. Also reported within
these results, is the resultant further increase in our pre-tax margin at
2.64%, compared with last year's 2.27percent.
The 28% increase in earnings per share, from 11.8p to 15.1p, clearly
illustrates the strengths of Northamber's tight management and financial
controls during this adverse period.
At 101.1p Net Assets per share increased by 10.1% an improvement on last
year's 91.8p.
Dividend
Our established policy is to continue to keep the level of dividend payments
under review. It is therefore proposed to increase the final dividend to
4.0p(net per share) making a total of 6.0p net for the year. This is a 20%
increase over last year.
Trading
The first half results were disappointing, restricted by the prolonged
downturn and low levels of pre-millennium demand. As already widely reported,
the post millennium marketplace then failed to produce the full extent of the
awaited and anticipated upturn. Whilst sales levels were firm, if unexciting,
the launch of Microsoft's Windows 2000 and faster offerings from Intel, also
then failed to fuel any new replenishment cycle.
These improved results are the product of the differentiation your Company
brings to its marketplace. They demonstrate our very high level of technical
expertise and added value. It is these core skills, over and above the
perception of our 'A' brand product distribution activities, which enable a
worthwhile return on the capital employed.
There was an increased contribution from our high levels of expertise in
complex I.T. network server system and corporate PC's assembly. These coupled
with improved efficiencies in stock turns and our fast order processing and
delivery, helped to better serve our established customer base, enabling them
to better focus on their own local business opportunities and core competence.
Financials
Whilst necessarily focusing on cost efficiencies and the controls on high
volume and marginal product sales, the value of our stocks at year end is
below that of last year. We continue to maintain our policy for the managed
avoidance of profitless revenue.
Results were further enhanced by the use of our available cash resource to
increase the controlled levels of credit extended to our customers.
During the period, when the Company's share price was unrepresentative of its
underlying value, there were several purchases of the Company's issued shares
for cancellation. With the financial resource readily available, such share
buy-backs will continue with the intention of further enhancing earnings per
share.'
Staff
The demonstrated abilities to improve efficiencies have enabled a restriction
in the growth of staff related overheads. The average number of staff
increased by only 1 from 416 to 417 during this financial year.
These results are, as always, totally dependent upon the efforts of our staff.
We extend yours and our own thanks for their strong contribution over the past
year.
The Board
After joining the Company last November, we were pleased to announce on August
10th 2000, that David Ives ACA had been appointed to the role of Finance
Director. David brings to the role many years of both financial and
operational experience, in both this industry as well as in retail and service
orientated activities.
Peter Fisher, whose home is in Blackburn Lancs., has been a Non-Executive
director for some two years. Regrettably, Peter has advised that the distances
involved have created difficulty in achieving the levels of involved interest
that he would seek. As a result, Peter will shortly be leaving the Board and a
suitable replacement is currently being sought.
Outlook
The new trading period has started on a more stable basis and in line with our
own expectations. Return on capital and margin retention will continue to
remain our primary focus and the Board is confident of a successful outcome
for the current year.
David Phillips
September 22nd 2000
CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year ended 30th June 2000
Note 2000 1999
thousand thousand
pounds pounds
Turnover 284,270 277,727
Cost of sales (259,059) (253,675)
Gross profit 25,211 24,052
Distribution costs (11,080) (10,887)
Administration expenses
Exceptional item (277)
Other administrative (6,880) (6,971)
costs
Other operating income 501 417
Operating profit 7,752 6,334
Interest receivable 144 130
Interest payable (373) (426)
Profit on ordinary
activities before taxation 7,523 6,038
Tax on profit on ordinary
activities (2,372) (1,971)
Profit on ordinary
activities after taxation 5,151 4,067
Equity dividends 3 (2,023) (1,724)
Retained profit for period 3,128 3,343
Earnings per ordinary 2 15.1p 11.8p
share
Diluted earnings per share 2 15.0p 11.7p
CONSOLIDATED BALANCE SHEET
For the year ended 30th June 2000
Note 2000 1999
thousand thousand
pounds pounds
Fixed assets
Tangible assets 2,850 3,121
Investments 2,833 2,833
_____ _____
5,683 5,954
Current assets
Stocks 11,262 12,896
Debtors - amounts falling due 41,294 34,216
within one year
Cash at bank and in hand 1,032 4,984
______ ______
53,588 52,096
Current liabilities
Creditors - amounts falling due
within one year (23,969) (25,331)
Net current assets 29,619 26,765
Total assets less current 35,302 32,719
liabilities
Creditors - amounts falling due (944) (1,053)
after more than one year
Provisions for liabilities and (1) (9)
charges
Net assets 34,357 31,657
Capital and reserves
Called up share capital 1,699 1,724
Share premium account 5,711 5,706
Capital redemption reserve 72 47
Profit and loss account 26,875 24,180
Equity shareholders' funds 34,357 31,657
CONSOLIDATED CASH FLOW STATEMENT
Year ended 20 June 2000
Notes 2000 1999
thousand thousand
pounds pounds
Cash inflow from continuing 4 554 7,803
operating activities
Returns on investments and
servicing of finance
Interest received 144 130
Interest paid (363) (495)
Income from fixed asset 200 189
investments
Net cash outflow from returns on
investments and servicing of (19) (176)
finance
Taxation
UK corporation tax paid (2,487) (2,812)
ACT paid (51)
(2,487) (2,863)
Capital expenditure and financial
investment
Purchase of tangible fixed assets (557) (1,104)
Sale of tangible fixed assets 31 165
Net cash outflow from capital
expenditure and financial investment (526) (939)
Equity dividends paid (1,870) (1,552)
Cash (Outflow)/inflow before (4,348) 2,273
financing
Financing
Purchase of shares (435) (26)
Issue of ordinary share capital 5 -
Debt due beyond a year:
Repayment of secured loan (109) (98)
Net cash outflow from financing (539) (124)
(Decrease)/Increase in cash in 4 (4,887) 2,149
the period
NOTES
1. Accounting policies
The Financial information set out above does not constitute the Group's
statutory accounts for the years ended 30th June 1999 or 30th June 2000,but is
derived from those accounts.The statutory accounts for 30th June 1999 have
been delivered to the Registrar of companies and those for 2000 will be
delivered following the Group's Annual General meeting.The Auditors have
reported on these accounts,their reports were unqualified and did not contain
statements under S237(2) or (3) of the Companies Act 1985.The information
contained in this statement does not constitute statutory accounts within the
meaning of section 240 of the Companies Act 1985.
2. Earnings per ordinary share
The calculation of earnings per ordinary share is based on the profit after
taxation of 5,151,400 pounds
(1999: 4,067,000 pounds) and on 34,131,038 ordinary shares (1999:
34,496,613). The number of ordinary shares in issue during the years ended
30th June 2000 and 30th June 1999 are the weighted average in issue during
each year.
Computation of Earnings per share for 2000
Per share Earnings Shares
Net profit for year 5,151,400
Weighted average
shares
Outstanding during 34,131,038
year
Basic earnings per 15.1p
share
Dilutive effect of 323,314
options
Diluted earnings 15.0p 5,151,400 34,454,352
per share
3. Dividend
An interim Dividend has been paid during the year of 2.0p per share.A final
dividend of 4.0p will be paid on 5th December 2000 to those members on the
register at the close of business on 10th of November 2000.The ex Dividend
date for the shares will be 6th November 2000
4. Cashflow
a) Reconcilitation of operating profit to operating cash flows
Group
2000 1999
thousand thousand
pounds pounds
Continuing operations
Operating profit 7,752 6,334
Income from fixed assets investments (200) (189)
Depreciation of tangible fixed assets 817 867
(Profit)/loss on sale of tangible fixed (23) (25)
assets
Decrease in stocks 1,634 920
(Increase)/decrease in trade debtors (7,063) 1,792
(Increase)/decrease in other debtors (22) 36
(Increase)/decrease in prepayments and (253) 82
accrued income
(Decrease)/increase in trade creditors (2,891) 302
Increase/(decrease) in other taxation 399 (2,163)
and social security
Increase/(decrease) in accruals and 404 (430)
deferred income
Exceptional Item - 277
Net cash inflow from continuing 554 7,803
operating activities
b) Reconciliation of net cash flow to movement in net funds
Decrease/(increase) in cash in the (4,887) 2,149
period
Cash outflow from changes in debt 109 98
Change in net debt resulting from cash
flows and the movement in net debt in
the period (4,778) 2,247
Net funds brought forward 3,930 1,683
Net (debt)/funds carried forward (848) 3,930
c) Analysis of net debt
At 1st Cash At 30th
Flow
July June
1999 2000
thousand thousand thousand
pounds pounds pounds
Cash at bank and in hand 4,984 (3,952) 1,032
Overdrafts (1) (935) (936)
4,983 (4,887) 96
Debt due after more than one (1,053) 109 (944)
year
Total 3,930 (4,778) (848)
A copy of this report is being sent to all Shareholders.
Copies are available to the public on request from the Company's offices
1, Lion Park Avenue
Chessington
Surrey
KT91ST
The Company's registered office is 1-3 Union Street, Kingston-upon-Thames,
Surrey KT1 1RP'